Trump’s fiscal cleanup will not be easy

President Trump was sworn in to much fanfare and celebration, and then went straight to work on Monday. It started with hiring freezes for federal workers and regulatory freezes as part of executive orders, but reining in America’s fiscal condition could prove more challenging.

“The biggest headwind is probably huge debt and a very, very inflated budget, which includes a lot of spending. It’s money that’s not actually spent at this point but is still planned to go out the door. You know, expectations about future spending. So that’s going to be very, very problematic.” EJ Antoni, The The Heritage Foundation, a research partner, told FOX Business before Trump took office.

The national debt – a measure of what the US owes its creditors – sits at more than $36 trillion and is growing, according to the US Treasury.

President Trump’s key fiscal deadlines

As for the budget, last Friday, the nonpartisan Congressional Budget Office (CBO) released its latest 10-year budget and economic outlook, which showed the federal government is on track to break the record debt set 80 years ago.

Melania Trump Stance in American Designers

“From 2025 to 2035, debt growth will outpace growth in Social Security, Medicare and interest payments,” CBO Director Philip Swagel told reporters.

The federal government is projected to run a $1.9 trillion budget deficit in fiscal year 2025. The deficit is projected to decline briefly over the next two years before continuing to widen. The short stay is tied to the expiration of part of Trump’s 2017 Tax Cuts and Jobs Act, which expires later this year. However, Trump Treasury Secretary Scott Besant is promising that won’t happen. Besant is expected to sail through the confirmation process.

Scott Besant vows to make the 2017 tax cuts permanent

“We must make permanent the Tax Cuts and Jobs Act of 2017 and implement new pro-growth policies to reduce the tax burden on America’s manufacturers, service workers and seniors,” Besant told the Senate Finance Committee during his confirmation hearing. “President Trump was the first president in our time to recognize the need to change our trade policies and to stand up for American workers.”

CBO’s analysis is based on current law, so changes in federal tax and spending policies could change those figures.

Another devil in secret; A cycle of easing by the Federal Reserve aimed at curbing inflation. Policy makers They cut rates three times in 2024, by 50-basis-point, followed by two 0.25-basis-point moves. Still, the 10-year Treasury yield, which sets rates for many credit metrics, including the mortgage rate, remains above 4 percent. According to Freddie Mac, loan advances rose 7 percent for the fifth straight week.

Investors celebrated the latest consumer price index reading, which is no surprise. The core rate, which excludes volatile food and labor, rose by an annualized 3.2% in December, which was lower than the 3.3% expected by economists. In the year Market participants expect no change at the Fed’s first meeting on January 29. CMEs FedWatch tool.

Ticker	Security	last one	Change	change %
BNO	United States Brent Oil Fund – USD ACC	32.18	-0.47	-1.44%
Use it	United States Oil Fund – USD ACC	81.11	-1.41	-1.71%
GLD	SPDR Gold Shares Trust – USD ACC	253.13	+3.86	+1.55%

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Still, inflation remains a wild card. Nimex and Brent crude have both gained more than 8% this year, while gold is trading below a peak of $2,788.50 an ounce.